The European Union’s antitrust office is studying complaints from car dealers that car manufacturers are violating new rules designed to open the industry to competition, an EU Commission spokesman told Dow Jones on Tuesday.
The news agency noted that car makers are renegotiating contracts ahead of the new [block exemption] law which comes into effect this October but Europe’s car dealers accuse manufacturers, such as BMW and PSA Peugeot Citroen, of trying to undermine the new rules by making it difficult for dealers to sell more than one brand and for repair shops to get licences.
“If the full freedom for car dealers and repair shops isn’t accessible then we are worried,” EU antitrust office spokesman Tilman Lueder told Dow Jones, adding: ” We have to take this seriously.”
Until now, Dow Jones said, the EU exempted the car sector from its tough antitrust rules but, under the new regime, manufacturers can no longer force dealers to sell only one brand. Retailers won’t be required to offer after-sales service and, for the first time, they will be able to sell cars outside their home territory. Manufacturers must also authorise independent repair shops when they meet quality standards.
According to Dow Jones, the goal is to allow new players, perhaps even supermarkets, to sell cars and ultimately to lower prices, which vary widely across the EU, but manufacturers have been dragging their feet, reluctant to give up their privileges.
In February, Dow Jones recalled, the EU’s antitrust chief Mario Monti lashed out against the industry’s obstinacy and, at a conference attended by industry chiefs, he complained car companies still made it difficult for consumers to buy cheap cars from abroad and are resisting moves to allow dealers to sell different brands.
If they continue to resist, carmakers could end up facing formal investigations and heavy fines, Dow Jones said.
“Where we detect problems, we can and will act vigorously to enforce the rules,” Monti reportedly said at the time.
According to Dow Jones, when Europe’s biggest car maker, Volkswagen, tried to make life hard for repair shops, the EU Commission stepped in and reached an agreement with the company in January that will loosen the German firm’s stranglehold over repairs to its cars.